Sensex opens in red, 286 points lower at 54,109; Nifty below 16,150
Indian stock indices extended their losses from the previous session to trade marginally in the red on Tuesday morning. This is the second-day decline on a trot.At 9.25 a.m., Sensex was at 54,174.64 points, down 220.59 points or 0.41 per cent, whereas Nifty was at 16,133.05 points, down 82.95 points or 0.51 per cent.”The dominant factor influencing markets – equity, bond, currency and many commodities – is the sustained rise in the dollar which has gained momentum during the last one month,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.In India, Tata Consultancy Services’ first-quarter results indicated margin pressure for the IT industry, which weakened IT index, Vijayakumar added.”The most resilient segment in the market now is Bank Nifty and the leading stock is ICICI Bank. This resilience of the banking segment is likely to continue. Autos, capital goods and some segments of FMCG also are on strong wicket,” Vijayakumar further said.Consistent weakness in the Indian rupee and selling of equities by foreign portfolio investors also weighed on the domestic stocks.On Tuesday morning, the rupee hit yet another fresh record low of 79.59 per US dollar, data showed.”On the domestic front, concerns about a ballooning trade deficit which has surged to a record high of $25.6bln in June are adding further pressure on the local unit. Besides, India’s forex reserves have declined by $5bln to $588.31 bln during the week ended July 1, highlighting the fact that RBI has been proactively intervening in the forex markets to curtail excessive volatility in the rupee-dollar exchange rate,” said Sugandha Sachdeva, Vice President – Commodity and Currency Research, Religare BrokingConsidering such market dynamics, Sachdeva said once the Indian rupee breaches the crucial 79.50 mark, it is likely to weaken towards the 80 to a dollar mark in the coming days.
